MANAGEMENT PROCESS AND

ORGANISATIONAL BEHAVIOUR
BBAI
ASSIGNMENT
UNIT – II

(Note:– Due Date of submission is 14/12/ 2023)

Q1 What do you mean by the term ‘Planning is a significant function of
management’.
Ans The statement "Planning is a significant function of management"
emphasizes the importance of planning in the overall process of
management within an organization. In the context of management,
planning refers to the systematic process of setting goals, defining
strategies, and outlining tasks and activities to achieve those goals.
Here are key points that highlight why planning is considered a
significant function of management:
Goal Setting:
Planning involves establishing specific objectives and goals for the
organization. These goals provide a clear direction for the entire
organization and help in focusing efforts toward a common purpose.
Decision-Making:
Planning requires managers to analyze various options, consider
alternatives, and make decisions about the most effective ways to
achieve organizational objectives. It serves as a foundation for decision-
making throughout the organization.
Resource Allocation:
Planning helps in identifying the resources (human, financial,
technological, etc.) required to achieve the defined goals. It enables
efficient allocation of resources and ensures that they are utilized
effectively to support organizational objectives.
Coordination:
The planning process involves coordinating various activities and tasks
to ensure that they align with the overall goals of the organization. It
helps in avoiding conflicts and ensuring that different departments work
together cohesively.
Risk Management:
Planning allows managers to anticipate potential challenges and risks
that may arise in the course of achieving goals. By identifying these
risks in advance, managers can develop strategies to mitigate them and
enhance the likelihood of success.
Flexibility and Adaptability:
Planning is not a rigid process; it provides a framework that allows for
adjustments based on changing circumstances. This adaptability is
crucial in dynamic environments where external factors may impact the
organization.
Motivation and Alignment:
Clearly communicated plans provide a sense of direction and purpose
for employees. When individuals understand how their work contributes
to the overall objectives of the organization, it can enhance motivation
and alignment with organizational goals.
Evaluation and Control:
Planning sets benchmarks and standards against which actual
performance can be measured. It facilitates the monitoring of progress,
and if deviations occur, adjustments can be made to bring the
organization back on track.
In summary, planning is a fundamental and significant function of
management because it establishes a roadmap for the organization, aids
decision-making, allocates resources efficiently, promotes coordination,
manages risks, and provides a basis for evaluating and controlling
organizational activities. Effective planning is essential for the success
and sustainability of any organization.
Q2 What do you mean by perfect rationality and bounded rationality.
Ans Perfect rationality and bounded rationality are concepts used in
behavioral economics and organizational theory to describe different
levels of decision-making rationality exhibited by individuals and
organizations.
1. Perfect Rationality:
 Definition: Perfect rationality assumes that decision-makers have
complete and accurate information, can process that information
without any cognitive limitations, and always make choices that
maximize their expected utility.
 Characteristics:
- Decision-makers have access to all relevant information.
- They can process information without any cognitive limitations.
- Decisions are always consistent and optimized to achieve the best
possible outcome.
 - Perfectly rational decision-makers can consider all possible
alternatives and consequences.
 Limitations:
- In reality, perfect rationality is a theoretical construct and doesn't
align with the cognitive limitations and information constraints faced by
individuals and organizations.
- Gathering and processing all available information is often
impractical or impossible, especially in complex and uncertain
environments.

2. Bounded Rationality:
 Definition: Bounded rationality acknowledges the limitations on
decision-makers' ability to gather, process, and analyze
information. It suggests that decision-makers operate within
cognitive constraints and make decisions that are "good enough" or
satisfactory rather than optimal.
 Characteristics:
- Decision-makers have limited cognitive abilities and information-
processing capacity.
- They use heuristics (rules of thumb) and simplified decision rules
to cope with complexity.
- Decisions are often based on a subset of available information
rather than exhaustive analysis.
- Bounded rationality allows for satisfying—choosing an option that
is satisfactory, though not necessarily optimal.
  Herbert Simon's Contribution:
- The concept of bounded rationality was prominently introduced by
Herbert Simon, a Nobel laureate in economics. Simon argued that
decision-makers often face information overload and cognitive
limitations, leading them to adopt strategies that simplify decision-
making.
 Implications:
- Bounded rationality has important implications for organizational
behavior and decision-making. It recognizes that decision-makers often
have to make decisions under conditions of uncertainty and incomplete
information.
- Organizations may develop routines, standard operating
procedures, and decision-making structures to cope with bounded
rationality.
In practice, decision-making tends to fall somewhere between perfect
rationality and bounded rationality. Individuals and organizations make
efforts to gather and process information effectively, but they are
constrained by cognitive limitations and practical considerations. The
concept of bounded rationality provides a more realistic framework for
understanding decision-making in real-world situations.

Q3 Define the term organizing? Explain the process involved in

organizing?
Ans Organizing is one of the key functions of management and
refers to the process of arranging resources and activities in a
systematic and purposeful manner to achieve organizational goals. It
involves creating a structure that defines roles, responsibilities, and
relationships within an organization to facilitate the efficient and
effective pursuit of its objectives.

The process of organizing typically includes the following steps:

1. Identifying Objectives:
- The organizing process begins with a clear understanding of the
organization's objectives and goals. These objectives serve as the
foundation for structuring the organization to achieve i ts intended
outcomes.

2. Division of Work (Work Specialization):

- Once objectives are identified, the next step is to divide the

overall work into specific tasks and activities. Work specialization
involves breaking down complex tasks into simpler, more
manageable components. This facilitates specialization and
expertise development among employees.

3. Departmentalization:

- After identifying tasks, the organization groups them into

departments or units based on similarities in functions, products,
geography, or customer groups. This is known as
departmentalization and helps in creating a logical and efficient
structure.

4. Assigning Duties and Responsibilities:

- Each position or role within the organization is assigned specific

duties and responsibilities. This step ensures clarity regarding what
each individual or department is expected to accomplish.

5. Establishing Reporting Relationships:

 - Organizing involves defining the hierarchy or chain of command
within the organization. Reporting relationships establish the lines
of communication and authority, outlining who reports to whom.
This hierarchy helps maintain order and accountability.

6. Delegating Authority:

- Delegation involves transferring authority from higher levels of

the organization to lower levels. It allows employees to make
decisions within their areas of responsibility. Effective delegation
enhances flexibility and responsiveness.

7. Coordinating Activities:

- Coordination is essential to ensure that various departments and

individuals work together harmoniously. This involves aligning
goals, activities, and resources to prevent conflicts and promote
synergy.

8. Establishing Communication Channels:

- Organizing requires the establishment of communication

channels for the flow of information within the organization. Clear
communication is crucial for coordination and effective decision -
making.

9. Designing the Organizational Structure:

- The culmination of the organizing process is the creation of the

organizational structure. The structure defines the formal
relationships and arrangements among different parts of the
organization, specifying how tasks are divided and how information
flows.

10. Monitoring and Adjusting:

 - Organizing is not a one-time activity; it is an ongoing process.
Managers need to continuously monitor the effectiveness of the
organizational structure and make adjustments as needed. Changes
in the external environment or organizational goals may necessitate
modifications to the structure.
Effective organizing ensures that the right people have the right
resources and information to accomplish their tasks, fostering
efficiency and goal attainment within the organization. It lays the
groundwork for successful implementation of plans and strategies.
Q4 “Authority can be delegated but accountability cannot”. Explain
the statement.

Ans The statement "Authority can be delegated, but accountability

cannot" reflects the principle that while individuals or managers can
be granted the authority to make decisions and take actions on
behalf of an organization, they ultimately remain accountable for the
outcomes of those decisions. In other words, the responsibility for
the consequences of one's actions cannot be entirely transferred or
delegated to others.

Let's break down the key concepts:

1. Authority:

- Definition: Authority refers to the power or right to give orders,

make decisions, and enforce obedience. In an organizational
context, authority is typically vested in individuals based on their
roles, positions, or levels within the hierarchy.

- Delegation of Authority: Organizations often delegate authority

from higher levels to lower levels. Managers may delegate decisi on-
making power to subordinates, granting them the ability to act
within specified limits.

2. Accountability:
 - Definition: Accountability is the obligation of an individual to
accept responsibility for the outcomes of their actions or decisions.
It involves answering for the results, whether positive or negative,
and being answerable for the proper execution of assigned tasks.

- Cannot be Delegated: Unlike authority, accountability is

inherently tied to the individual. While tasks and decisions can b e
delegated, the ultimate responsibility for the consequences of those
actions remains with the person who has been held accountable

Explanation:

- When authority is delegated, it means that someone has been given

the power to make decisions and take actions on behalf of another
individual or the organization.

- However, accountability is tied to the concept of answerability and

responsibility for the outcomes. Even if a person delegates authority
to someone else, they cannot completely delegate away the ultimate
responsibility for the results of those actions.

Implications:

- Managers and leaders need to be aware that, while they may

empower others by delegating authority, they still retain a level of
responsibility for the outcomes.

- Delegating authority is a way to distribute tasks and decision-

making to improve efficiency and effectiveness, but it does not
absolve individuals from being answerable for the impact of those
decisions.

Example:
Consider a manager who delegates the responsibility for a proj ect to
a team leader. While the team leader has the authority to make
decisions regarding the project, the manager remains accountable to
higher levels of management for the overall success or failure of the
project. If issues arise, the manager is ultimately answerable for the
results, even though authority was delegated.

In summary, the statement emphasizes the indivisibility of

accountability and the fact that, even though authority can be
delegated, ultimate responsibility for the outcomes of actions rests
with the individual who is accountable.

Q5 Write shot note on:-

a) Types of authority
b) Span of management
c) Formal and Informal organisation

Ans a) Types of Authority:

Authority in an organization refers to the legitimate power or

right to give orders, make decisions, and enforce obedience.
There are several types of authority:

1. Line Authority: This is the most straightforward form of

authority where a superior has direct control over subordinates in
the chain of command.

2. Functional Authority: Individuals or departments have

authority over specific functions or activities, often cutting across
the regular chain of command.
3. Staff Authority: Staff specialists have the authority to support,
advise, and assist line personnel, but they do not have the same
level of direct command.

4. Centralized Authority: Decision-making authority is

concentrated at the top levels of the organization.
5. Decentralized Authority: Decision-making authority is
dispersed throughout the organization, allowing lower levels to
make decisions.

6. Delegated Authority: The transfer of authority from a higher

level to a lower level in the organizational hierarchy.

b) Span of Management:

The span of management, also known as span of control, refers to

the number of subordinates a manager can effectively supervise.
There are two main types:

1. Narrow Span of Management (Tall Structure): Few

subordinates report to a manager, creating a tall organizational
structure. This allows for close supervision but may result in a
slower communication process.

2. Wide Span of Management (Flat Structure): A manager

oversees a larger number of subordinates, creating a flatter
organizational structure. This promotes faster communication but
may pose challenges in maintaining close supervision.

The choice between a narrow or wide span of management

depends on factors like the complexity of tasks, competence of
subordinates, and the nature of the manager-subordinate
relationship.

c) Formal and Informal Organization:

1. Formal Organization:
 - Definition: The official, planned structure of roles,
responsibilities, and relationships within an organization as
outlined in organizational charts and job descriptions.

- Characteristics: Clearly defined roles, hierarchical structure,

formal communication channels, and adherence to organizational
policies.

2. Informal Organization:
- Definition: The network of unofficial relationships, social
connections, and interactions that develop among employees
within an organization.

- Characteristics: Emerges spontaneously, based on social

interactions, shared interests, and personal relationships. It is not
documented and often operates outside formal channels.

3. Relationship:

- Complementarily: Formal and informal organizations coexist

and complement each other.

- Overlap: Informal networks may overlap with formal

structures, influencing communication and organizational
dynamics.

4. Importance:

- Formal: Provides structure, clarity, and order.

- Informal: Fulfills social and psychological needs, facilitates

communication, and can impact organizational culture.

Understanding and effectively managing both formal and

informal aspects of an organization is crucial for achieving
overall success and fostering a positive workplace culture.